FHA / Student Loans / deferred loans

[Anonymous]

Good Day,

I was wondering if anyone could tell me how defereed student loans are calculated into your DTI when applying for a mortgage?  Currently my student loans are all deferred.  

Also if anyone has any insight into minimum FICO scores / recent late payments / paid charge offs when appling for an FHA.

Thanks! 

[jaylynn30]

FHA loans use 1% of your total SL balance as the monthly payment. The minimum FICO my last lender used for FHA was 580 for 3.5% down but I think you can go a lot lower (500-ish?) with 10% down. Not sure about charge-offs and lates but someone else will surely chime in

[JVille]

Paid charge offs are good that means your credit scores should start to recover. Charged off how long ago? Paid off when....
As to lates, it depends? How recent, how many and what does you credit history look like. A single recent late on an otherwise spotless past history is fine but lates in the last 12 months is a huge issue if you have history of poor payment habits.
Every borrower is viewed on their own merits and every credit history is unique.

[Anonymous]

Thank you for your reply.  All of my charge offs were "settled" paid 0 balance recently.  The most recent late happen in June on my Honda Lease. 30 Day late.  It was a pattern on 6 lates on Honda the past year, otherwise all other installment history is spotless. 

[ShanetheMortgageMan]

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@Anonymous wrote:

Thank you for your reply.  All of my charge offs were "settled" paid 0 balance recently.  The most recent late happen in June on my Honda Lease. 30 Day late.  It was a pattern on 6 lates on Honda the past year, otherwise all other installment history is spotless. 

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In general, underwriters are usually looking for 12 months of clean credit history at the time they review your loan for approval.  An isolated late payment within 12 months usually isn't an issue, but if there have been repeated late payments over the last few years then a late payment in the last 12 months could be an issue getting approved.  In your situation, in my opinion you'd need a very good reason for those late payments for an underwriter to be OK with them.

If there is a chance someone can get approved and they cannot wait for their situation to improve, then I always recommend to just give it a shot as worst case is you get a "no" and then are told how much longer you'd need to wait for approval.